Thursday, October 27, 2011
Another suit filed against MERS
This time by the State of Delaware. Attorney General Biden is seeking to prevent MERS from acting as a beneficial party while the courts determine the amount of fraud committed by MERS and its owners.
The Delaware attorney general’s office sued Merscorp Inc., which runs a national mortgage registry used by banks, saying its practices are deceptive and hide information from borrowers.The previous suits against MERS are to recover unpaid fees and taxes. If your real estate recording entity is not now planning to sue MERS you need to ask why.
The MERS database, which tracks ownership interests in mortgages, obscures information from borrowers and impeded their ability to fight foreclosures, Delaware Attorney General Beau Biden said in a complaint filed today.
“MERS engaged and continues to engage in a range of deceptive trade practices that sow confusion among consumers, investors and other stakeholders in the mortgage finance system, damage the integrity of Delaware’s land records, and lead to unlawful foreclosure practices,” Biden said.
MERS tracks servicing rights and ownership interests in mortgage loans on its electronic registry, allowing banks to buy and sell loans without recording transfers with individual counties. MERS acts as the lender’s nominee and remains the mortgagee of record as long as the note promising repayment is owned by a MERS member.
Banks and investors have the true economic interests in the loans, and the ownership of the mortgage notes is purportedly recorded in the MERS registry, to which the public has limited access, according to Biden. Biden said the system is “frequently inaccurate.”
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